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Following the Rules

Publix Tipping Policy Case Study: How to increase your customer service rating and get excellent Yelp reviews

Publix is a chain of grocery stores in the southeastern United States known for fantastic service.

The main thing that makes the service so great is that when you buy groceries, the bagboys pack it up, take it to your car, AND, as anyone who shops at Publix knows, they don’t accept tips for this service.

If you try to hand over money, they’ll say “no, no thank you, no no no no nooo.” Try as hard as you want, you’ll never be able to give them extra money.

Smiling publix employee

Nah man, it’s cool.

This is because of Publix corporate policy that says if an employee takes a tip, they lose their job. Now, that sounds really aggressive, and yet Publix is rated number 1 for customer service in the southeast.

How can stores with a policy like that have such a high customer service rating? It’s all about psychology.

There’s a principle called the Rule of Reciprocity made famous by Robert Cialdini’s book Influence: The Psychological Power of Persuasion that explains how we act when somebody does a favor for us.

Here’s a quote from a review of that book:

When one person does something for another, that other person senses that a debt is owed and is compelled to repay.

Reciprocity is a shortcut for making decisions. Life is too complicated to carefully evaluate every element of every situation, so we learn to take shortcuts to help us make what are usually reasonable and reliable decisions.

That’s why Publix ties not receiving a tip to the employee’s jobs; not needing to give a tip is Publix doing us a favor, and now we’re inclined to repay it by visiting the store again.

Let’s say you’re out in the parking lot of a grocery store, and the bagboy is very helpful; he carries all the bags out, puts them in the back of your car, maybe like says hi to your kid or just does something really nice, and then you want to tip him.

Per his training, he’s going to say no, and 1) you’re going to feel like you want to tip him, but you’re also, deep down, not going to want to part with extra money, 2) he feels like he wants the tip, but he’s also going to feel like he doesn’t want to lose his job.

So we’ve got two negative factors working toward not giving the tip to the employee.

YOU don’t want him to lose his job by taking the tip, and HE doesn’t want to lose his job.

You’ve also got positives: 1) the fact that you wanted to hand him money and then couldn’t because he would lose his job, feels just as good as handing him the actual money, and you didn’t spend anything. You feel instant good vibes, and Publix’s customer service rating goes up.

And, 2) since it’s an understanding that Publix employees don’t get tips, Publix’s standing with the employee doesn’t go down at all.

Here are a couple examples of how you can use this for your business:

1. If you run a dry cleaning store and your competitors across the street are offering all these crazy perks and pulling your customers away, do something simple: offer free delivery with no tips. Assuming you pay the person delivering dry cleaning a liveable wage, your customers will be ecstatic when they don’t have to tip.

2. Also, if you work at a coffee shop at the bottom of a large commercial building, start running coffee upstairs to people and not charging a delivery fee or a tip. You can batch coffee orders, and make one run every half hour. It’ll be a small use of your time, but will make your shop incredibly popular in the building.

3. Last one, take the tip jar off the counter at your shop, and replace it with a sign that says, “no tip necessary, say a thank you instead!” and then put a shortlink (i.e bit.ly) to leave a Yelp review. The good vibes you create by not taking tip will increase customer happiness and motivate them to leave positive reviews.

That’s all I got.

-Alex

P.S. If you know somebody that would benefit from reading this post, send it to them! They’ll like you more for it.

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